Episode 172 – Pakistan’s False Dawn and the Beginning of History with Aqdas Afzal

Macro N Cheese – Episode 172
Pakistan’s False Dawn and the Beginning of History with Aqdas Afzal
May 14, 2022

 

[00:00:04.510] – Aqdas Afzal [intro/music]

In order to address these very severe problems that we are facing as a human race, I think it is very important that countries like Pakistan and India can sit down across the table from each other and resolve their differences in a spirit of cooperation and harmony that is now more urgent than ever before.

[00:00:29.430] – Aqdas Afzal [intro/music]

The biggest issue that Pakistan has faced is that we have been unable to consolidate and institutionalize democracy in our political system.

[00:01:42.090] – Geoff Ginter [intro/music]

Now, let’s see if we can avoid the apocalypse altogether. Here’s another episode of Macro N Cheese with your host, Steve Grumbine.

[00:01:43.150] – Steve Grumbine

All right, folks, this is Steve with Macro N Cheese with another episode. And today we have Dr. Aqdas Afzal. And he is from Pakistan. And I’ve had the opportunity to get to know a little bit of his work. Fadhel Kaboub recommended him very highly. And so let me tell you a little bit about Dr. Afzal. He attended the Ohio State University where he earned his bachelor’s in Political Science and Economics with a minor in Farsi.

In 2006, he completed his master’s in Political Science from the Ohio State University and returned to his native Pakistan. From 2006 to 2012, Dr. Afzal worked in the development sector in both Lahore and Islamabad. Additionally, he taught as an Agile faculty member in the Economics Department at Lahore University of Management Sciences and at the Government College University, Lahore.

In 2011, Dr. Afzal won the prestigious Fulbright Scholarship to pursue a doctorate in Economics at the University of Missouri, Kansas City. In 2013, Dr. Afzal interned at the United Nations in New York City. In 2015, he won the Association of Institutional Thoughts, AFIT, prestigious Student Scholars Prize in Economics. In 2016, Professor Afzal was the three minute thesis champion at his University.

In the same year, he won the Journal of Interdisciplinary Research Jitter, Best Paper Prize while also bagging the Graduate Studies Dissertation Research Award. And he also does some great writing. In particular, one of the recent things I got to read from him was called The Beginning of History at a publication called Dawn. And without further ado, let me bring on my guest. Thank you so much, Aqdas. Welcome to the show, sir.

[00:03:43.590] – Aqdas Afzal

Hey, Steve, thank you. Thanks for having me. Great to be here.

[00:03:48.270] – Grumbine

Absolutely. We’ve been doing a tour around the world and trying to explore modern monetary theory, macroeconomic sociopolitical issues, geopolitical issues, and the impacts of this heterodox school of thought that relies on history and so many other interdisciplinary facets that impact macroeconomic thinking. And so now we’re heading to Pakistan and can’t think of anyone better to talk about it than you, sir.

[00:04:20.730] – Afzal

Thank you so much. I’m really excited. I have been listening to your podcast, your work for some time, and I was really excited when you approached me. And I’ve been looking forward to speaking with you about all these very important issues.

[00:04:35.370] – Grumbine

Well, thank you so much. So we mapped out a three part interview. You started off with the concept of a false dawn, basically how Pakistan’s independence from Britain in 1947 turned out to be a false dawn. And we’re going to talk a little bit about the extension of the neoliberal project and how after these elections, Pakistan got embroiled into the neoliberalism project.

And then we’re going to end up with dark messiahs. And basically how Pakistan’s external conflict between civilian military is now changing into a conflict between democracy, fascism. This is going to be a very well rounded podcast, a lot of different facets. Hopefully, we’ll talk a little bit about the IMF and the way that the United States and Western nations have predated on countries around the world to serve as their natural resource depot, if you will. And so let’s jump right into it. Let’s start with this concept of the false dawn. Why don’t you set the stage for us?

[00:05:39.520] – Afzal

Sure. So the idea of false dawn has to do with Pakistan’s independence. For those of you who probably don’t know that Pakistan and India used to be one country before 1947, and they were ruled by Britain through this very draconian system of controlling India that was known as the British Raj. And in 1947, Pakistan becomes an independent country. So that was almost 75 years ago.

But that independence was incomplete, Steve, because this new country did not have much infrastructure. It did not have much to speak in the way of any economic base, and it did not even have its own independent central bank. However, this new country did inherit two very interesting institutions from the British Raj.

The first one was the British Indian military, of course, because, as you know, the British had recruited hundreds of thousands of soldiers from India for all their major wars, the First World War and the Second World War. And so the first institution was the British Indian military. However, the second institution was called the Indian Civil Service, which then subsequently became the civil service of Pakistan.

But for American audiences, when you use the term civil service, it sounds like something very benign. Somebody working in a DMZ would probably qualify civil service. But the civil service that we are talking about here, the Indian Civil service or something that became the civil service of Pakistan was a very, very unique institution. It was an institution that was labeled as the steel frame that governed India.

And the idea was that you basically had this collection of Oxford and Cambridge educated white men who were basically all in control in particular districts of India. So one white person, white men. And these are usually white men would act as a revenue collector in a particular district. This person would also control the local police. This person would also maintain law and order.

And this person would also keep harmony between different ethnicities and communities in that area and also officiate and adjudicate and become a judge in certain murder trials. So basically, one white person was governing for the British Crown without any accountability to the local people because these people were basically selected through a competitive examination.

And once you had played that examination, you were made what was known as a deputy Commissioner. And the point to remember here, Steve, is that the British were in India not to govern. They were in India to extract surplus and to maintain what they called law and order. And so the British left without giving the local people any taste or mechanism for bringing about accountability or democracy.

But they did leave behind these two very, almost draconian institutions for keeping law and order. And because of these two institutions, these two state institutions that the British left behind. In the case of Pakistan, the first 25 years of Pakistan’s history was complete chaos. So in the first 15 odd years, you basically have these civil servants trying to dominate political power.

And there are these constant palace intrigues. There is influence from foreign power, so on and so forth. And then finally, in 1958, you get Pakistan’s first military, first military government, and that rules Pakistan. That governs Pakistan. I shouldn’t use the word govern, it rules Pakistan until 1970, which is when Pakistan has its first universal franchise Democratic election.

And the result from these elections was not particularly salubrious. And as a result of these elections and all intrigue that had gone into preventing the people from getting power, the country is dismembered into two separate countries. The Western wing of the country became what is now known as the Republic of Pakistan. And the Eastern wing became what is now known as Bangladesh.

And this separation of Pakistan. First, the separation of India into two countries, India and Pakistan, was a humanitarian crisis. There was genocide. According to different calculations, almost 1.5 million people were killed in the partition or independence that happened in 1947. And then subsequently, when Pakistan gets separated into two different countries, that was, again a very, very horrific affair.

So this is where this idea of false dawn comes from. The generation that had struggled and the generation that had made so many sacrifices to provide independence to Indians or Pakistanis. These were people that were hoping for a very bright future. They wanted to live in a country where they could really exercise their Democratic rights as well as their economic right. But reality turned out to be very, very far from that dream. So hence, I gave this first part of this interview, this title, false dawn. And so this is what the idea of the false dawn is all about, Steve.

[00:11:55.710] – Grumbine

It seems like India and Pakistan are mortal enemies. Am I mistaken? It seems like climate change hitting the two and causing migration could be one of the single most devastating consequences of the modern world. I’m just curious if that’s the way it is.

[00:12:17.190] – Afzal

Well, I wouldn’t use the word mortal enemies, but definitely I would say that the two countries have been unable to resolve their outstanding problems and issues that have been lingering on really for the last 75 years, problems that could be described as the unfinished agenda of partition. So I think the point that you make is a very valid one because the kind of problems that we are going to face or we are facing right now as a human race, these are really transboundary problems.

Your air pollution does not really stop at India’s border or Pakistan’s border. These are transboundary problems. So in order to address these very, very severe problems that we are facing as a human race, I think it is very, very important that countries like Pakistan and India can sit down across the table from each other and resolve their differences in a spirit of cooperation and harmony that is now more urgent than ever before.

[00:13:27.810] – Grumbine

What is some of the unfinished business that came out of this false dawn? What are some of the things that might be lurking?

[00:13:35.550] – Afzal

Well, in the case of Pakistan, I think the biggest issue that Pakistan has faced is that we have been unable to consolidate and institutionalize democracy in our political system, even though we started having elections from 1970 onwards. And remember, this was the election in the aftermath of which Pakistan was separated or got divided after a very bloody civil war into two different countries.

There were many instances of the military intervening and putting the whole Democratic process on pause. And so even to this day, democracy has not become consolidated or institutionalized in the case of Pakistan. So I think if you read any of the main thinkers in the world right now, like Daron Acemoglu or some of the other people who write about institutions, there is now very wide agreement on the fact that for any society that wants to move in the direction of a better quality of life.

And this comes directly from their book, The Narrow Corridor I get, which is all the rage in the US. The first and the most important thing they must do is to develop political institutions. And out of all the different kinds of political institutions that you can have, the consensus now is that democracy is that one institution or that one meta institution that leads to the development of many other important institutions that a society needs in order to ensure that the quality of life is ever improving, because that is something that is very, very urgent and important in the case of developing countries like Pakistan.

[00:15:37.170] – Grumbine

Okay. Thank you. So as you’ve gone through this election in the 70’s understanding that Pakistan still has not been able to institutionalize democracy. It doesn’t take much to realize Milton Friedman era began in the 60’s, the libertarian neoliberal project really began in that 60’s time period. It appears that the neoliberal project found its way to Pakistan as well. Can you talk to me about that?

[00:16:11.790] – Afzal

Sure. Pakistan fell into the lap of neoliberal thinking because of the Cold War. It’s kind of interesting because you may remember that there was a time when there used to be this country called the Soviet Union, and the Soviet Union was considered a very dangerous country by many people in the west. So when the Soviet Union invaded Afghanistan, which is next door to Pakistan, certain changes or certain very important political changes started taking place in Pakistan.

And when it became clear that the Soviets were going to be in Afghanistan, a military government took over in Pakistan. And this military government that took over started taking Pakistan closer and closer in the direction of the United States. And when this defense cooperation started emerging between the two countries, naturally, there was an exchange of intellectuals and thinkers and academics and what have you.

And before you knew it, Pakistani economic policymakers were speaking the same language that was heard in the US under Reagan and in the UK under Thatcher. And this was, as you know, the neoliberal project. And it didn’t stop with the implosion of the Soviet Union. And this is where we go into the whole 1990, the end of history era. And if you want, we can keep talking about what happens after the end of history.

[00:17:56.730] – Grumbine

Absolutely.

[00:17:59.010] – Afzal

So, as you know, once the Soviet Union was no more this idea that the state had to be taken out of everything, the state had to become what the children used to be in Victorian era, it could be seen but not heard. That kind of a minimal state was now required post Washington consensus, which happened in 1989 90.

And this is when a leading intellectual in the US, Francis Fukuyama, talked about this idea of the end of history, that now that the Soviet Union has been defeated, Liberal democracy and capitalism is the final stage of the human race’s evolution. And so there is no other pathway available to human societies. Hence, he called it the end of history.

And so economic policy in developing countries like Pakistan started converging to these ideas. And in very large numbers, this new Liberal project of deregulation, privatization and de politicization was initiated in many countries like Pakistan. And the results of those steps that have been taken in the 90s, they have not really made much of a difference. As a matter of fact, poverty has increased.

As a matter of fact, society has become more unequal. As a matter of fact, social unrest has increased. Pakistan’s share of exports as a percentage of total global exports has fallen. So in a sense, even though we’ve been following this advice coming from international financial institutions, like the IMF and the World Bank, because these institutions represent the neoliberal project, it hasn’t really worked for countries like Pakistan.

So where Pakistan has followed this advice, it hasn’t really worked for us. So I think it’s time that thinkers in Pakistan or in countries that resemble Pakistan can come up with alternative pathways or alternative theories how to go about in its journey towards economic growth, development and a better quality of life.

[00:20:30.270] – Grumbine

So the IMF, the World Trade Organization and the World Bank have largely been seen as extensions of US imperialism without actually invading to extend Empire and to build neo feudalism on a global stage. We see this happening now with Ukraine and Russia and the IMF hooks into Ukraine. And we’ve seen this throughout the global south as a whole.

And it seems like this neoliberal project’s primary purpose is to create markets, to extract resources for the west and build out these communities, to make them palpable for global multinational corporations. This whole liberalization of markets has been going on for quite some time. What is the state of Pakistan in terms of foreign debt and where they fit in quality of life today? What does Pakistan look like at the moment?

[00:21:44.430] – Afzal

Well, it doesn’t look like we are on the path towards economic recovery. Like I said, we’ve been following the advice of all these various international financial institutions, the World Bank, the IMF. But for various reasons that you have explained just now, poverty has increased, quality of life has decreased, and we are now facing some pernicious and tough economic challenges, especially in this wider region.

You may have been reading about what’s happening in Sri Lanka of late, and although the situation in Pakistan is not that extreme, but I think if left unchecked, it could very well progress in that direction. And Sri Lanka is a great example of how even though they have tried their best to follow the advice coming to them from these different institutions, the economy is going through a full and utter meltdown at the moment, and it’s a classic balance of payments problem.

It’s a classic balance of payments crisis. You know, the way WTO tells all these different countries that you have to have free trade? Well, the problem with countries in the global south is that where a very large segment of their population, the so called rich people, have all the resources to import all the luxuries that anybody would want to enjoy in any of the developed countries of the world. They simply don’t have an export base.

They simply don’t have a diversified export base to pay for those imports. And as a result, before you know it, foreign exchange runs out, and then you are staring down the abyss, just like Sri Lanka is staring down the abyss right now. So it’s not just Pakistan that is facing these problems. Having followed the advice coming from these international financial institutions, these are many more countries, and Sri Lanka is one example right in front of you in the wider region that is also facing a very challenging economic situation right now.

[00:24:07.270] – Grumbine

If I’m looking at this clearly, one of the things that jumps out at me is this balance of payments story. And for the audience that maybe isn’t familiar, and we’ve covered this with Bill Mitchell several times, with Warren Mosler. But the way I understand this is countries that don’t enjoy full monetary and resource energy sovereignty have to have reserves of whatever foreign currency that they’re trying to do business in.

[00:24:37.840] – Afzal

That’s right.

[00:24:38.270] – Grumbine

And if the foreign reserves are used up by the rich buying luxury items for themselves, the basic imports that are life sustaining for the rest of the community isn’t there. And so now you are short on the reserves you need to make those import purchases. And this puts a country into a very precarious position where they are then forced to take out loans from the IMF. And this is when the structural adjustments are brought forward and austerity as their pathway forward.

[00:25:15.970] – Afzal

Yeah. So I think two or three things that you said were very important. So when you say countries that do not enjoy energy sovereignty, which I think is a very important point because a lot of these countries are net energy importers. And so with this foreign exchange, whatever it is that you have earned from your very narrow export base that you might have as a developing country.

So in the case of Pakistan, for instance, our economy is basically stuck in what is known as the low value added spectrum of exports. So first of all, we focus on a sector that doesn’t really earn you a lot of foreign exchange. So Pakistan’s main export base is focused on the textile sector. Textiles are something that the UK or Britain was making during the Industrial Revolution.

200 years ago, the Industrial Revolution was all about textiles. Textiles based in Lancashire. So you can have this idea of how they did this technology. Countries that now make a killing when it comes to earning foreign exchange are now exporting Silicon chips. They are exporting all these technical gizmos. In the case of India, for instance, it’s now leapfrogged over agriculture and manufacturing, and now it’s earning foreign exchange because of the services sector.

So when we talk about countries like Pakistan, we are stuck in the low value added corner of this value added export spectrum. So we cannot earn a lot of foreign exchange. And whatever little foreign exchange we earn that is then used up by the rich people who import all these luxuries, these Audis and Mercedes and what have you. And then no foreign exchange is left behind to import the real essentials, like fuel, like medicine.

And so when this happens, a country is said to be going through a balance of payments crisis. And in order to avert this, countries have no recourse but to go to the lender of last resort internationally, which is the IMF, and basically asked them to bail them out. And the IMF does bail countries out, but it comes with some very stringent conditions or what are called conditionalities.

And these conditionalities or conditions basically focus on extending or reinforcing the neoliberal project, basically trying to get the state out of economic management, moving in the direction of market fundamentalism. So when we talk about taking the state out of everything, you’re also talking about curtailing expenditure, because if the state is shrinking and the overall expenditure that that state was making also shrinks, and that’s where austerity comes in.

So the advice that is given to developing countries or countries in the global south whenever they face a balance of payments crisis by the IMF is austerity. And this is very strange, the whole idea of being advised by the IMF to practice austerity because you know what? I have been following very closely the advice that has been coming out of the IMF for developed countries since COVID-19 raised its ugly head.

And you would be very surprised to find out that developed countries are being told by the IMF to use fiscal stimulus, which is the opposite of austerity. But when the IMF goes to developing countries which desperately need fiscal stability because they are poor countries, they are being told to practice austerity, which doesn’t make sense one bit. And this basically points you in the direction of double standards that these international financial institutions practice when it comes to engaging with countries in the global trade.

[00:29:57.710] – Intermission

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[00:30:48.690] – Grumbine

I appreciate that explanation very much. Let me ask this follow up question then. So as I understand it, the neoliberal project, if taken to its final conclusion, is complete privatization of everything, the end of the public purpose in giving it away to private interests. I often say the United States number one export is neoliberalism, and it seems the first task is to eliminate public services for the poor citizens and replace that with private interests in private markets and profit motives.

[00:31:27.270] – Afzal

That’s right.

[00:31:28.650] – Grumbine

The question for me here is this. I know that MMT explains Macroeconomics wherever it is around the world, but the spectrum of sovereignty that Fadhel Kaboub and then Ndongo Samba Sylla talk about at the nation state level and how the governments, which have infinite power over their currency, as long as something is for sale in the nation’s unit of account, they can purchase these things.

So the country like the United States, that’s often called the richest country on Earth, you watch the government intentionally withhold its fiscal power for developing nations such as Pakistan who are still struggling with issues of democracy. The output of neoliberalism in the United States is brutal. I can only imagine what it’s like in a nation that doesn’t have the development capabilities and lack of sovereignty for various goods and services. How brutal this can be. Can you elaborate on that?

[00:32:34.830] – Afzal

Sure. So whatever is happening between IMF and developing countries of the global south? So we talked about the fact that this one institution, the IMF, that gives one piece of advice to developed countries. It tells them, look, you have to spend more on the fiscal side because this is what is required right now. But when the same institution goes to developing countries, it gives them completely different advice.

It asks them to practice austerity. So there’s these double standards that we see when it comes to advice. Something very similar happens in the United States. Look at all the poor people in the US cashing their payday loans. Whereas when really large banks fail in the economic crash that happened in 2007 and 2009, the financial crisis, they were deemed too big to fail and they were bailed out.

But when poor people are in need of some extra assistance from the government in the shape of maybe some kind of an extra stipend for paying for child care or for health insurance, for example. Health insurance is such a big issue in the US. Obama, when he came out with Obamacare, he couldn’t really pitch it without making it a marketplace health insurance in the first place.

So something very similar is happening in the US as well. The same government bails out really big corporations and banks because they are deemed too big to fail. But the same government does not help its own citizens who are poor and who basically don’t have the resources to buy many of the things that they require. So they go and they cash their checks on their payday and they pay these exorbitant injurious interest rates.

And in both situations, the IMF dealing a short end of the stick to countries in the global south and poor people in the US. Both situations basically tell us that there is a huge, huge, huge democratic deficit. The IMF is not accountable to poorer countries of the global south. If it was, it would never be giving them different advice.

And if democracy was working for poor people in the US, the government would never really leave them alone to fend for themselves. So in a sense, both of these situations are somewhat similar. In both these situations, we find that there is this huge group of people, in one case nations, and in the other case poor people in the US that don’t have power that they require in order to make the system work for them.

[00:35:41.770] – Grumbine

I understand that. How does a country acquire the necessary reserves to maintain the quality of life they need without taking on these horrible debt arrangements with the IMF?

[00:35:55.750] – Afzal

Well, in the case of Pakistan, what you would have to do is you would have to implement import controls. Whatever the WTO is telling you that free trade works wonders for everyone. Guess what? It’s not working wonders for many poor countries that don’t have a diversified export base. So the first thing you do is that you implement import controls and you provide some protection to your own industry.

You channel some funds towards your own industry, you give them cheap capital, you give them all the other things that are required and you bring them to a level whereby whatever it is that you are producing can compete with the rest of the world. And that’s when you open your economy. And this is an idea that is known as import substitution industrialization.

Many countries in the world have successfully practiced this against the advice of international financial institution. This is exactly how India developed its industrial base and once they were ready to compete with the rest of the world, they opened their economy in the year 1991. The work of Ha-Joon Chang is another example of this idea when he talks about this in his book Kicking Away the Ladder.

The work of Mariana Mazzucato also talks about how the state must play a dominant role in developing an industrial and export base before opening up the economy. So that’s the first thing you do. You control the number of imports you can make, you conserve your foreign exchange and you develop your Indigenous capability to the level where you can compete with the rest of the world.

And once you have achieved that, that’s when you open your economy. So in a system of free trade, which is what WTO and the IMF is telling countries in the global south, they are never going to be able to achieve the number or the size of foreign exchange reserves that would make them profitable. They are basically going to go from one balance of payments crisis to another. And every time the IMF is going to bail them out and every time they get bailed out, they are going to have to accept stricter and stricter conditions coming from the IMF. So it’s an unending cycle really.

[00:38:31.090] – Grumbine

You wrote an article, just a couple of days ago, on the beginning of history and one of the quotes the world seems to be reentering a Hobbesian phase, complex, chaotic and violent. It seems like this is an important point to talk about how history repeats itself and how some of these ideas that were once long forgotten come back to life. For me, I’m an unabashed socialist at some level.

I don’t find beauty and glory in capital. I struggle with the exploitation and the extraction, and I don’t appreciate the neo feudal approach to things. So I don’t flinch and cringe when I see the word communism as much as I do capitalism, honestly. So talk to us a little bit about this concept of the beginning of history.

[00:39:28.150] – Afzal

Okay. Interesting that you asked that. You remember, I mentioned the work of Francis Fukuyama, who wrote this very interesting essay, and then we later turned that into a book, The End of History, in which he argued that since the Soviet Union had collapsed, capitalism and democracy were the final points in the human race’s evolution, and no more pathways were available, and hence, this was the end of history.

Well, this idea is not a new idea. This idea that history traveled in a straight line, that it’s unilinear, that it’s unidirectional is an old idea, especially came on the scene after the end of the Second World War when all these new countries started emerging in Africa and Asia. And so this new theory developed that was called modernization theory, which argued that these new countries in Asia and Africa, it was a foregone conclusion they were going to become Western style Liberal democracies.

But for some of them, it could take a very long time. And in order to assist these countries in their journey towards becoming Western style Liberal democracies, which was deemed inevitable because history traveled only in one direction from the past to the future, various departments and agencies were set up by the US. USAID is one example – this agency that was set up to assess these countries.

Well, we have seen in the last few years that history doesn’t really travel in a straight line. Structures, people, variable – even if they have been relegated to the so called dustbin of history, keep making their comeback. So history, for the lack of a better word, is definitely cyclical. For a very long time, things seem to be moving in one direction, but there are always inflection points, and we seem to be going through another inflection point, especially with the recent events that we have witnessed in the Russia Ukraine conflict.

Russia is a country that went through shock therapy, that was undertaken by experts coming from the World Bank and the IMF. These experts are basically telling Russia how to open its economy, how to change over from communism, socialism to a market based economy. The same Russia today is challenging the might of capitalist countries like Britain, United States, Germany. What have you.

So what we have seen is that there is no end of history, really. History is cyclical. And that’s why I called my latest oped the one that you referred to, the beginning of history. So it’s kind of a play of words. I’ve used this title to show that there was no end of history, really, which is what Fukuyama talked about. It’s the opposite of the end of history. And so I’m calling this the beginning of history, and that’s what the whole idea is about.

[00:42:58.750] – Grumbine

So with that in mind, I think the other aspect of this is you see the rise of fascism around the world in the Amazon with Bolsonaro and other strongman States. The Nazification of aspects of Ukraine. Talk to me about the rise of global fascism.

[00:43:22.690] – Afzal

Right. So again, this takes us back to the idea of history not traveling in a straight line. History being cyclical. Variables, structures, and people keep making their comeback. And so it seemed to us that the idea of fascism had died with the death of the Third Reich or with Mussolini’s Italy or what have you. But of late, what we have seen is that fascist ideas or fascism or fascist political parties are again rearing their ugly head all over the world.

And in order to understand the rise of fascism or fascist tendencies in so many different societies around the world, we really have to think very deeply about what it is that leads to the rise of fascist tendencies in different societies. So I think in order to theorize about what brings about fascism or fascist tendencies, we have to go back in history and study and see what were some of the reasons that we’re bringing about such fascist tendencies in Germany and Italy and then in other places around the world.

So I know this is going to make many people uncomfortable. But one of the explanations or one of the ideas attached to the rise of fascism in Germany was this sense of an overlapping crises that the people in Germany started feeling. There was this economic crisis that really began with the Treaty of Versailles. And here is where I would like to bring my favorite economist, John Maynard Keynes, into the picture.

And Keynes writes this book, The Economic Consequences of the peace in 1919. And he warned about the situation in Germany. And he says the kind of reparations that you are putting on Germany, you are basically pushing them into a corner. And then he’s proved right. So there is a sense of overlapping crises. I mean, there is this hyperinflation that happens in Germany. There’s these reparations.

And on top of all that, you get the Great Depression in 1929 and all these different crises that people were facing. Out of this chaos and crises comes this messianic figure, this father like figure that promises a solution to all your problems and who also provides you with this idea of a prior golden age. So whenever we talk about this fascist message, there is always this idea of taking people back to the prior golden age.

So in the case of Trump, he always talks about make America great again. So America was great, and now he wants to make it great again. Same is the case with Mussolini. He would always talk about the great Roman Empire. And so this is how fascist tendencies arise. So there is the sense of an overlapping crisis. There is an emergence of this father-like charismatic messianic figure that promises an end or a solution to all your problems.

And the role of technology and the role of technology hasn’t really been studied very well. So in the case of the 20’s and 30’s there were these new technologies that were being used very effectively. In the case of Germany, the use of radio. And then I don’t know if you’ve seen this documentary, The Triumph of Will made by Leni Riefenstahl, who uses this new technique of documentary filmmaking.

Oh, yes, to glorify Hitler as the person who was going to bring about an end to all the problems being faced by the German people. And fast forward to what we’ve been facing since the financial crisis of 2007 and 2009. You first see the emergence of fascist political parties in Europe. You have Golden Dawn in Greece. You have these other fascist political parties and movements rearing that ugly head everywhere in the world.

And then new technologies, social media reaching out to so many different people has never been easier through Twitter to WhatsApp, Facebook? So this is the kind of new technology that has really played a huge role in resurgence of fascist tendencies, because now I think the growth engine of capitalism is finally slowing down.

And the kind of improvements in people’s quality of life that was happening year after year after year, it’s no longer available. I think for the first time, many people in the US are now seriously thinking that the lives of their children in the future are not going to be as good as their lives. And I think this is a very new feeling that people are having in countries like the US.

So in all of this chaos, climate change, not having enough growth, inequality, poverty, what have you, you have the emergence of these messianic figures who are now promising you a solution to all your problems while very efficiently and productively using these new technologies which are making the dissemination of this message very, very easy and cheap at the same time. There you have it, a theory of fascism, Steve.

[00:49:05.410] – Grumbine

It’s an important one, too, because what we had January 6, what they’re calling the insurrection. And regardless of who started what, you have a group of people who are genuinely outraged and dissatisfied with life in America. And you have the neoliberal faction, which is the Democratic Party, that have presented they’re the blue collar people, the Union supporters, while showing absolutely zero evidence of doing any of the things they say.

Because neoliberalism is a sub component of fascism. And they both require scapegoats. And they both have a bunch of other sociopolitical angles that create good guys and bad guys. They thrive on constant conflict as opposed to cooperation and peace. And so people did everything they could to bring about a Treaty of Versailles, if you will, on the Donald Trump gang with absolutely nothing to show for it.

No student debt forgiveness, no Medicare for all, no job guarantee, no Green New Deal, no payments during the pandemic, nothing for the people. And there’s Donald Trump going, I can make America great again.

[00:50:26.120] – Afzal

There you go.

[00:50:27.320] – Grumbine

And now Biden’s in and Biden has produced absolutely nothing. And I’m sorry to those people out there who felt like we’ve got to do everything in our power. But the fact is, it doesn’t do us any good to bring in fascism light through neoliberalism, while fascism itself thrives on the failures of neoliberalism to develop a firmer and firmer route.

And people dared to tell me Biden was the lesser of two evils, when in fact they both feed from one another. It’s not a matter of lesser, they’re both evil. And this is one of the very few times you’ll hear me actually passionate on this podcast because I’ve been gaslit by people I consider to be very smart people into believing certain things.

And I just reject the programming. I know for a fact that this kind of neoliberal garbage creates fascism. It is steroids for fascism. And we can thank failures of neoliberal state for creating an even more cruel fascist state. I really feel strongly about this.

[00:51:32.830] – Afzal

I largely agree with your analysis, and I think it’s in line with what I have said. But it’s just that you have put in such better fashion compared to myself. I just wanted to add that when I talked about the emergence of this messianic figure, this charismatic figure, father-like figure, we can really think of these leaders that are taking their people, are using people who are fed up with so many difficult situations that they are facing.

We can really label these leaders as dark Messiahs because, at least in the case of countries of the global south, the coming conflict and struggle is going to be one between democracy and fascism. And I really hope that somehow, in some fashion, we are able to create a counter narrative to all this fake news, alternate facts, gaslighting propaganda that is now being effectively used by these dark messiahs so that democracy and real power to people can save the day for so many people in the global south.

[00:52:48.970] – Grumbine

This is a great way to end it. I really appreciate the time you’ve spent with me today, Aqdas. This is so important. And if we were to have more time, which unfortunately, we’ve run out of – the effects of climate change will only make this scenario that we’ve laid out exponentially worse. And I hope people really pay attention.

As the west begins to devour its own resources, as it isolates and nationalism comes back, you’re going to begin to see a new phase in this climate war that I don’t think any of us are equipped to deal with. So with that, Aqdas, thank you so much for joining me. Tell everybody where we can find more of your work.

[00:53:31.930] – Afzal

Okay, so you can find my work in Pakistan’s leading English language newspaper, Dawn, in which I write a monthly Op Ed column. And you can just Google my name and Dawn and my work will come up. And I would love to hear back from your listeners – and please share your feedback. And it was great being on this podcast, Steve. And thank you for giving me this opportunity. I look forward to speaking with you again as and when the opportunity arises.

[00:54:02.050] – Grumbine

Absolutely. This is wonderful. All right, folks, this is Steve Grumbine, one of my guest Aqdas Afzal and we are out of here.

[00:54:35.070] – End credits

Macro N Cheese is produced by Andy Kennedy, descriptive writing by Virginia Cotts, and promotional artwork by Andy Kennedy. Macro N Cheese is publicly funded by our Real Progressives Patreon account. If you would like to donate to Macro N Cheese, please visit patreon.com/realprogressives.